Madoff, Admitted Swindler, Escapes Jail Once Again:
Commentary by Ann Woolner
Jan. 13 (Bloomberg) -- The clock ticked toward the moment when U.S. Magistrate Judge Ronald Ellis would say whether he would now -- finally! -- toss Bernard Madoff in jail.
In a corner of its screen yesterday, CNBC showed the minutes, the seconds, until Ellis would rule. Reporters and cameras clogged the front of Madoff’s apartment building and covered the service entrance, too. A rumor that he was already at the federal courthouse aired.
It’s hard to name a more despised private citizen alive today than Madoff. (Rod Blagojevich isn’t a private citizen.) Once deeply admired, the man admitted -- admitted! -- he cheated thousands of trusting suckers out of $50 billion, according to the feds.
On top of that, while under house arrest, Madoff mailed more than $1 million worth of jewelry, despite a court order that froze all his belongings.
Surely that would land him in jail, no?
When that moment came, Ellis posted his ruling on the court’s Web site a few minutes after noon. He refused to revoke Madoff’s bail yesterday, resisting the tug of public opinion.
“You gotta be kidding,” the New York Post’s Web site said on its front page under the headline, “Home Free” and a photo of Madoff.
The government announced it would appeal.
Although Ellis set stricter conditions on Madoff, the ruling surely infuriates those marking the moments until Madoff is cuffed and led to jail to await conviction, at which point he would be tossed into a federal penitentiary for the rest of his life. Acquittal wouldn’t be possible in this version.
A Free Man
One of his victims told CNBC he simply can’t understand why the criminal justice system hasn’t already put Madoff in jail.
He should read Ellis’s ruling.
Note this essential point early in the 22-page decision:
“The issue at this stage,” Ellis wrote, “is not whether Madoff has been charged in perhaps the largest Ponzi scheme ever, nor whether Madoff’s alleged actions should result in his widespread disapprobation by the public, nor even what is appropriate punishment after conviction.”
When it comes to deciding between bail or jail, it just doesn’t matter how much financial pain Madoff inflicted or how solid the evidence against him. It doesn’t matter how betrayed his investors feel or how many charities, hospitals or universities were hurt.
The question the magistrate had to answer wasn’t whether Madoff is good or evil. It is whether jail is the only way to make sure he doesn’t flee, or to protect the public from danger.
Under House Arrest
Until last week, prosecutors had been satisfied with Madoff’s $10 million bond, keeping him under house arrest at his apartment, wearing an ankle bracelet, under 24-hour surveillance. Any further restrictions would have to be justified by some sort of change, Ellis said.
The prosecution conceded there was no serious risk Madoff would flee, though arguing meekly that as the evidence against him grows stronger so does his risk of flight. Ellis found that unpersuasive.
That is where the end-of-the-year distribution of the watches, the diamond bracelet, the heirloom cufflinks come into play. Madoff’s lawyer, Ira Sorkin, argued the mailings were an innocent mistake.
But Assistant U.S. Attorney Marc Litt accused Madoff of dissipating assets ordered frozen in a Securities and Exchange Commission lawsuit. Those are assets that could be distributed to Madoff’s victims.
And that poses an economic danger to the community, Litt argued, in an attempt to get around the fact that the 70-year-old Madoff poses no physical danger to anyone. I found it persuasive at the time.
A Last Resort
Ellis didn’t. Prosecutors offered “minimal evidence” that the mailings caused so great an economic harm as to create “a danger to the community,” he wrote. Again, we are speaking here of $1 million worth of items, not a $50 billion Ponzi scheme.
The greater problem for Litt, and for all those hoping to see Madoff behind bars as soon as possible, is that jail is considered a last resort when the accused hasn’t been found guilty. Madoff hasn’t even been indicted.
Everyone is innocent until convicted, so no one is supposed to be jailed pretrial if there is another way to protect the public and make sure they show up for court.
The house arrest and surveillance, which Madoff’s lawyers proposed, satisfies the latter point. As for protecting the public against dissipation of assets, they came up with a way to satisfy Ellis on that, too.
They offered to let a government-approved security company inventory “all valuable portable items” in his apartment, check the apartment every two weeks to make sure nothing’s missing and search all outgoing mail.
These are extraordinary measures, rarely taken. They show that with enough creativity and money -- Madoff’s wife is paying for the extra security -- jail isn’t the only answer.
The same prosecutors now appealing Ellis’ ruling didn’t even respond to those suggestions, and Ellis ruled the government failed to show that only jail could protect the public.
And protecting the public, not punishing the still legally innocent Madoff, is all that matters now.
(Ann Woolner is a Bloomberg news columnist. The opinions expressed are her own.)
To contact the writer of this column: Ann Woolner in Atlanta at awoolner@bloomberg.net.
Last Updated: January 13, 2009 00:01 EST |
